In a filing this morning, tax-return experts Jackson Hewitt (JTX) announced that their partner in providing refund anticipation loans - RAL's - has backed out of their agreement.
Santa Barbara Bank & Trust was expected to make 75% of all company RAL's this year, but was told by its bank regulator to dump this business. What that means about RAL's going forward is anyone's guess, but based on company filings it will be a material hit to JTX's results. Financial product revenue, of which RAL's are a part, made up 24% of last year's revenue:
JTX shares are off 24% today. It being Christmas Eve, many analysts and investors are not even at their desks to sift through the earnings impact this will have, so in the absence of some feedback investors are dumping shares.
The whole release: